NHL’s Relevancy Problem

In my last post, I vented frustrations about the NHL’s lockout of its players over contract issues. My conclusion was that the NHL does not care about fans, so why should fans care about the NHL? Yes, I am perturbed by the NHL’s inability to avoid work stoppage and the resulting interruption in hockey, but the league faces a much larger problem that will loom larger with each passing day of the lockout. Hockey is but one sport in the sports entertainment landscape… and a relatively small one at that in the United States. Maintaining relevance as one of the major sports properties will become more difficult for the league if it continues to wage battle at the bargaining table instead of on the ice.

The early fall season is a sports fan’s dream: College football and NFL seasons are underway, MLB is headed toward its postseason, NASCAR is in the homestretch for the Sprint Cup, and the NBA and college hoops are waiting in the wings to get started. On top of all this activity, soccer is enjoying newly found interest in the U.S. through MLS expansion and expanded coverage of the English Premier League. A prolonged absence by the NHL will result in the league losing relevance among casual sports fans, the very ones needed to expand the fan base for hockey.

In a recent blog post, Bleacher Report CEO Brian Grey points out that several U.S. sports properties are on the rise in terms of heightened sponsor interest. Expanded playoff format for MLB, exciting rookie quarterbacks in the NFL, intense geographic rivalries in MLS, and new energy in New York and Los Angeles for the NBA increase the value of associating with these properties for sponsors. In contrast, the NHL sits on the bench as owners and players argue over what percentage of revenues each side should get.

The NHL has a very passionate core fan base, and while we (I have to count myself among this audience) are likely to forgive and return to the sport there are many more sports fans than us for which hockey is a take-it-or-leave-it proposition. The NHL worked diligently since the last lockout to attract people to the sport. In the process, it made the NHL more valuable to corporate sponsors, which is one reason why the league’s annual revenue increased from $2 billion to $3 billion. Sadly, many of the gains made in recent years by the NHL stand to be lost in a relatively short period of time.

The relevance clock is ticking, National Hockey League. Your great sport will become marginalized (some would say marginalized further) if you do not get your product back on the market quickly. Consumers have many other options for sports entertainment, and sponsors have other (and more effective) options to reach and engage their customers.

The NHL Doesn’t Care – Why Should We?

I am a lifelong hockey fan, which is a noteworthy claim coming from someone whose childhood years in Mississippi in the 1970s definitely did not include playing hockey. My father was French-Canadian, so I was indoctrinated on hockey history and the game itself at an early age. Today, I am still a hockey fan, and while I love the National Hockey League I am now making a point to call myself a hockey fan, not an NHL fan. The reason is simple: The NHL does not care much about its fans, so why should fans give emotionally and financially to the NHL?

I am convinced of the NHL’s lack of regard for fans given that the third work stoppage in the last 18 years is about to commence barring a miraculous 11th hour deal between the NHL and NHL Players Association. NHL team owners want to reduce the proportion of hockey related revenue players receive. Of course, players have no interest in giving up their piece of the money pie. The result is going to be another lockout. The prospects for a quick resolution are not good – heck, the two sides are hardly talking to each other to negotiate a settlement even though the deadline has been on the horizon for months.

For hockey fans, the takeaway is clear: the NHL does not care about its fans. On the surface, such callous disregard for the impact a lockout will have on fan relationships seems unthinkable. How could a business not work tirelessly to make sure its core product remains on the market and available to its customers?

The reality is that fans are down the list in importance as a customer for the league. The NHL’s primary customer is its team owners. It is understandable that owners’ interests must be protected; no owners equals no NHL. But, the perception is that owners’ interests are being served to the exclusion of paying customers. However, fans are not even at the top of the charts when it comes to paying customers. Media rights holders and corporate sponsors are a higher priority for the NHL than the hockey fan or family that ponies up for tickets to watch their local team.

The NHL will keep players locked out until a deal is reached that satisfies the interests of the league’s key customers, the owners. Oh, a sense of urgency might develop if media and corporate partners become vocal about the need to get back on the ice. As for fans, our voice is not being heard even though social media gives us a platform for venting our frustrations.

The fan base for hockey is much smaller than other major sports in the US, but fans are rather passionate about their hockey. The expectation is that these fans will return when the labor mess is sorted out. Don’t be so sure, NHL. After all, hockey is only a game. And, as long as you continue to play games with your fans do not expect us to welcome you back with open arms if there is a protracted lockout.

Showrooming: Be Resourceful, not Resistant

E-commerce has represented a threat to brick-and-mortar retailers ever since online sellers began hanging out their virtual shingles in the late 1990s. However, the threat has intensified thanks in large part to smartphone capabilities. Shoppers scan bar codes to do comparison shopping, look up user reviews, and visit retailers’ web sites to gather information. Any of the above actions can come between a potential buyer and a making a sale. But, according to research sponsored by mobile marketing company Vibes, retailers should adopt a different outlook than the fear created by “showrooming” customers going online to make purchases.

Findings of a survey of 1,000 phone users point to mobile marketing being a valuable information resource for shoppers as they make in-store purchases. Highlights from the survey include:

  • 84% said they used their phones to do research while shopping in a store
  • 48% of those who had used their phones to do research in-store said they felt better about their purchase
  • 6% abandoned a potential purchase in-store and bought from a competitor, even though 33% of those who had done research with a mobile device visited a store competitor’s website

 The main takeaway from the study is that consumers use mobile devices as a resource to aid in making buying decisions. It is not necessarily a competition to see which seller has the lowest price as much as it is which one delivers the best buying experience. Thus, retailers should embrace the mobile consumption habits of their customers, not loathe them.

The key is to meet customers’ desires for information by creating relevant mobile resources. QR codes, mobile-device-friendly websites, and custom applications are three mobile experiences that can be developed. “Relevant” is the key word – how many times have you scanned a QR code that takes you nowhere in particular, maybe the brand’s website home page? In other words, there is often no strategy behind the technology.

Shoppers want information. Retailers that act more like a friend and become a dependable resource for information via mobile marketing stand to benefit, both online and in their stores. Commit to being resourceful, not resistant, for customers showrooming in your stores.

Data and Targeting Insider – “Showrooming is More about Confidence than Comparison”

Social Media: A Staple of Retail Advertising?

Consumers are accustomed to retail advertising consisting of heavy doses of newspaper inserts, mail circulars, and other mass delivered one-way messages. The traditional model will soon be a distant memory if predictions arising from a recent study come to pass. A survey of grocery marketers conducted by Valassis found that the traditional reliance on print media as an advertising channel will be declining dramatically in the next five years. Today, three-fourths of grocery executives use print media for marketing purposes. In five years, the number dwindles to 17 percent. In contrast, the proportion of grocery marketers saying that they will use social media as a marketing channel will rise from 12 percent to 65 percent during the same period.

Skeptics might interpret these findings as grocery marketers perhaps being too euphoric about social media. However, it seems that bullishness on social media marketing may be based on impact rather than hype. A new study by Ryan Partnership on retailers’ social media activity found that connecting with shoppers via social media is not just cool, it has observable payoffs. Among the study’s findings on how social media impacts shopper behavior were:

  •  44% of shoppers surveyed indicated that a retailer’s social media update influenced a purchase
  • 36% said following a retailer on social media led to trying a product
  • 18% said they tried a brand because their friends like or follow the brand

Social media alone is not changing advertising; how we consume information has created a need for new communication approaches to reach and engage audiences. It would be understandable if some advertisers resisted a shift away from traditional media to rely more on social channels. After all, “traditional” means that it is customary practice, it is the way it has been done in the past. But, consumers are not hanging on to the past – they are using the tools of the day to acquire and share information. So, marketers may long for the good ol’ days, but we must align our practices with consumer behavior.    

What’s Behind the Glass?

There are some things that captivate the attention and curiosity of almost everyone. For example, I was running recently when I saw stopped at the intersection in front of me a car with a clown in the passenger seat. I could feel a smile cross my face as I ran by, and I thought to myself “how can a clown not make you smile?” (OK – I know some people freak out at the sight of clowns, but that is a post for an expert in another field to tackle).

Another example of how people are captivated is what I observe when visiting a Krispy Kreme location. People of all ages are spellbound by the “show” going on behind the glass. The production process is in full view as we witness dough transformed into delicious glazed goodness. What makes the cooking process so interesting? Perhaps it is that it reveals how a product that is enjoyed by so many people takes its final form. For other people, the curiosity of how stuff works is fulfilled by getting a glimpse into how the product is made. In either case, Krispy Kreme engages customers by inviting them to have an up-close experience with the brand.

You may not market a product as tasty as Krispy Kreme doughnuts, but that does not mean that you do not have an interesting story taking place “behind the glass” in your business. Is there unique craftsmanship or manufacturing processes used to build your product? Are there interesting stories related to the products made or the people who make them? Offering a peek at the inner workings of your organization can make your brand more personable, potentially strengthening customers’ connections with your brand.

Do not discount the potential interest that exists for people to look behind the glass to see you in new ways. Whether it is factory tours, customer site visits, or a video series posted on YouTube, draw people closer to your brand by giving behind-the-scenes access when appropriate. While you do not want to give away proprietary information, invite those people who care most about your brand to share in your world.

Would Customers Wear Your Colors?

Happy College Colors Day! If you are unaware of this special day, the Friday before the first full weekend of the college football season is designated as College Colors Day. People are encouraged to don the colors of their favorite college sports team as football fans revel in the beginning of a new season. Why not – your favorite team is undefeated! An interesting side note – College Colors Day is orchestrated by Collegiate Licensing Company, the market leader in officially licensed products for colleges and universities. Creating a “holiday” around your business is savvy marketing!

The passion for college football and fans’ desire to show their affinity for their favorite team by wearing t-shirts and jerseys led me to wonder how a “Brand Colors Day” might play out. Would I be willing to go with an outfit featuring the red, black, and silver of Diet Coke? Could I find a Chipotle cap to wear that day? More importantly, what would it take for me to feel so strongly about a brand that I would lead me to identify with it by wearing its colors?

Although a Brand Colors Day may not become part of our popular culture, maybe businesses can benefit from thinking that there is such a day. Would customers wear your colors? Do they have a compelling reason to identify with you? Social media provides a virtual means of wearing colors by liking or following brands that matter to us. But, we have to bring people to the point that they are willing to wear our colors.

If your brand is not relevant or little more than a commodity, do not expect to be represented heavily on Brand Colors Day. Great value and memorable experiences forge brand relationships. We are inclined to tell others about brands that matter to us. It is up to marketers to make it happen – give a reason why people should be passionate about your brand.

Happy College Colors Day! Enjoy the pageantry of college football.

Daily Deals are not a Bargain

The daily deals coupon market made popular by Groupon and copied by many others (with mixed results), reached a saturation point very quickly. Consumers are bombarded with offers from restaurants, spas, service providers, and retailers offering 50% off on a “hot deal.” The novelty of daily deals wore off as numerous competitors joined Groupon in vying for customers. Yesterday, Groupon’s stock price closed at $4.37, an all-time low. Groupon’s stock value today is a far cry from the $26.11 per share close on the day of its IPO last November.

In less than four years, Groupon has gone from start up to category creator to a troubled business. What happened? Reality has hit businesses using Groupon that the bargains consumers receive come at the expense of their profitability. Groupon’s revenue sharing model typically calls for a 50-50 split in revenues deals sold. Given that deals are usually a 50% discount off regular price, a business has effectively given away three-fourths of potential revenue for every Groupon-bearing customer walking through the door. It is hard for the math to work for low-margin businesses that forsake significant revenue to attract buyers.

Deep discounts like those offered by daily deals are detrimental to building brands. They are gifts to buyers, at least that is how I feel when I am able to get a 50% discount at a restaurant. But, it does little to foster long-term loyalty between customer and brand. In theory, coupons are an incentive that attracts buyers to sample a product. Assuming they see sufficient value, potential future purchases might occur without an incentive. Unfortunately, the glut of daily deals gives consumers leeway to shop around for the best deal rather than buy from brands because of a relationship anchored on something other than a discount.

Customers are the lifeblood of a business. But, attracting them with unprofitable daily deals will cause bleeding that harms a business. Instead, explore how to strengthen relationships with your best customers by rewarding their patronage. It likely does not require a 50% discount, and they will reciprocate your gesture with continued support of your business.

Know Your Customers’ Mindset

As a new academic year begins for me, I find it useful to take a closer look at my “customers” to gain better perspective of the world as they see it. One way I do this is to review the annual Mindset List, a collection of facts and characteristics of the year’s incoming college freshman class. This year marks the 15th edition of the Mindset List. Among the 75 items on the Class of 2016 Mindset List are:

  • Women have always piloted war planes and space shuttles
  • History has always had its own channel
  • They have never seen an airplane “ticket”
  • They watch television everywhere but on a television.

The Mindset List evokes feelings of nostalgia, surprise, regret, and excitement, depending on your age. For me, the Mindset List is a reminder that the world around us is a dynamic place in which people are constantly adapting their behavior. When people change, their needs and wants change. Yet, the rate of change for businesses often fails to to keep pace with shifts in customers’ lives. The main reason is that we are slow to observe significant changes in customers’ mindsets.

Take a few moments to look at the Mindset List for the Class of 2016. Although the list describes today’s 18-year-olds, apply the idea of a mindset list to consider how your customers see the world. Is that view markedly different from past years? Has your business responded to changes in customer mindset? Customers expect you to meet them where they are today. Knowing their mindset is essential.

You Need a Logo… and a Lot More

A ritual of the new academic year is a full day of faculty meetings the Friday before classes begin on Monday. Today was that day. First up was a department meeting. An item of discussion was a continuation from our last meeting in the spring on a possible branding initiative for our department (Management and Marketing). We have a brand identity in name only. No logo, symbol, slogan, or other brand marks. We will be moving forward with a branding initiative, but the scope of the project is going to surprise some faculty.

One of the branding needs our department has is to create a visible identity (i.e., a logo or symbol). What will be surprising to some faculty is that developing a brand mark is one of the last tasks that need to be done. A brand is not one-dimensional; it simultaneously serves four purposes:

  1. A brand is an identity (we’ve got that one figured out)
  2. A brand is an image – Perceptions people hold about you
  3. A brand is an experience – Interaction with your product evokes thoughts and emotions
  4. A brand is a relationship – Strive for ongoing, repeated interactions rather than transactions

A recent post by Seth Godin asked “What if you slogan is true?” Godin’s contention was that slogans do not make a brand great but rather the story of the brand. A slogan is a “symptom” of that story. Godin concludes by saying “start with a slogan. But don’t bother wasting any time on it if you’re merely going for catchy. Aim for true instead.”

My department will be working on crafting its brand story this year. We will get around to developing a logo. But, we have much work ahead to define our brand’s mission, values, content, and messaging. We need a logo… and a lot more.

Is Your Message Authentic?

In my last blog post I shared a commercial for Ragu spaghetti sauce that featured a young boy walking in on his parents spending quality time in the bedroom. The spot is humorous, but one has to question how such a message advances the Ragu brand long term. Another commercial I saw recently had the opposite impact, in my estimation. A Wendy’s commercial touted the “Wendy’s Way,” a commitment to serving quality products. The messenger was Wendy Thomas, daughter of Wendy’s founder Dave Thomas and the restaurant’s namesake.

The strength of this commercial is its authenticity. The message is a straightforward, heartfelt effort to communicate the brand’s values. And, the message source evokes a favorable emotional response. Although Wendy Thomas does not have the same sense of ease in front of the camera as her late father, she is a capable brand ambassador that keeps alive the legacy created by Dave Thomas.

Brand messages should be authentic; they must communicate purpose and meaning to the audience. People do not buy products because they want them; they buy products because of what they do for them. Human nature leads us to ask the question “What’s in it for me?” when considering a product purchase. Your brand messages should provide answers to that question. Wendy’s answers the question by touting the quality customers receive.

What’s in it for your customers to buy from you? Do your brand messages answer that question? Authenticity, not audacity, builds brands. People should think about your brand because they admire it, not because they laughed at your 30-second commercial.